BP Amoco Plans to Eliminate 10,000 Jobs

BP Amoco said it will accelerate its cost-cutting plan and fire more workers after a prolonged slump in oil prices led to a 37% drop in fourth-quarter profit. The company, created when British Petroleum Co. acquired Amoco Corp. in December, said profit from operations fell to $875 million, or 6 cents a share, in line with analysts’ forecasts. Chief Executive John Browne said BP Amoco plans to cut 10,000 jobs, up from the 7,000 planned in August. The company also plans to achieve its goal of saving $2 billion annually in one year instead of two, Browne said. As a result, BP Amoco will take $1.5 billion in charges in the next year instead of over two years. BP Amoco’s operating profit in its oil exploration and production unit plunged 75% to $420 million. In refining, profit rose 20% to $506 million, while chemicals profit fell 6% to $125 million. Browne said oil prices are likely to trade between $11 and $17 a barrel for the foreseeable future and that BP Amoco is planning for Brent crude oil to average $11 a barrel this year. BP Amoco’s American depositary receipts fell 38 cents to close at $81.88 on the New York Stock Exchange.